Six years after Walt Disney Co. spent $4 billion to buy a single franchise, “Star Wars” is looking a little less stellar.

Despite being one of the past year’s most successful movies, “Star Wars: The Last Jedi” has fallen short of Wall Street’s expectations due to a faster-than-expected falloff at the box office, declining toy sales and a poor showing in China.

With...

Six years after Walt
Disney Co.
spent $4 billion to buy a single franchise, “Star Wars” is looking a little less stellar.

Despite being one of the past year’s most successful movies, “Star Wars: The Last Jedi” has fallen short of Wall Street’s expectations due to a faster-than-expected falloff at the box office, declining toy sales and a poor showing in China.

With $1.3 billion in global box office for “The Last Jedi,” the most of any movie released in 2017 and No. 9 of all time,
Disney’s
problems are ones other entertainment companies would kill to have. Nonetheless, for a property as valued as “Star Wars,” any sign audiences are losing faith is concerning and could prove costly down the road if the trend continues.

“
Disney
started off with an incredible touch with Star Wars, but now it’s looking a little less magic,” said B. Riley FBR analyst Barton Crockett.

Across Hollywood, studios have prioritized franchises that spawn sequels, move toys and provide maximum negotiating power over movie theaters. If the Skywalker saga is starting to lose its must-see status, that could spell trouble for the company as it prepares to release new movies from this May well into the 2020s.

“The Last Jedi” will soon end its run with around $625 million in the U.S. and Canada, about $200 million short of several Wall Street analysts’ expectations. While few thought it would match the $937 million domestic and $2.07 billion world-wide gross of 2015’s “Star Wars: The Force Awakens,” the franchise’s return to the big screen after a decade away, analysts forecast the new film would come closer.

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Foreign grosses followed a similar pattern.

In the U.S. and Canada, “The Last Jedi” opened to $220 million, slightly behind “The Force Awakens,” which had a $248 million opening. With overwhelmingly positive reviews and an A audience rating according to CinemaScore, it looked like another “Star Wars” movie would have a long, healthy run.

But by mid-January, it was grossing less than half as much each day as “The Force Awakens” at the same time two years ago and less even than 2016’s spinoff “Rogue One,” which didn’t feature iconic characters in major roles and opened to $155 million.

It’s been 40 years since the original Star Wars film was released and fans can look forward to a regular supply of new films and merchandise in the coming years. But, with the release of “Star Wars: The Last Jedi,” a small band of rebels—who loved the early films—just can’t take it anymore. WSJ’s Mark Kelly reports.

Disney theatrical distribution chief Dave Hollis said in an interview that “The Last Jedi” box office returns have been “the result we were expecting.” He noted that the second film in prior “Star Wars” trilogies also grossed less than their predecessors.

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Not all series follow that pattern. Marvel Studios, which Disney also paid $4 billion to buy, has released 17 superhero movies in 10 years with no sign of a box office slowdown.

Star Wars toy sales during the 2017 holidays were the lowest since Disney relaunched the brand in 2015, according to NPD Group. For the full year 2017, it was the No. 2 toy brand in the U.S. behind Nerf and down from No. 1 in 2016. Worldwide, it remained No. 1.

Josh Silverman, executive vice president of licensing Disney Consumer Products, noted in a statement that Star Wars remained the No. 1 toy franchise during the holidays.

Electronic Arts Inc.’s
tie-in videogame “Star Wars Battlefront II” is on track to sell between 10 million and 12 million copies compared with 14 million for the first installment in 2015, according to several industry analysts. That is partly due to a plan to sell virtual goods that appeared to give big spenders a competitive edge, which it canceled just before release due to fan outcry.

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An EA spokesman declined to comment.

With blockbuster grosses expected for “The Last Jedi,” Disney was able to demand theaters play the movie for a minimum of four weeks, an unusually long period. That hasn’t been a problem for large multiplexes, but strained single-screen cinemas like Rodney Miller’s Elder Theatre of Jackson Center, Ohio, population 1,400, where screenings were nearly empty later in the run.

“The first week was good, the second week was pretty decent, and the third and fourth weeks were disasters,” he said.

The new film’s take on Star Wars mythology, in ways a rebuke to the nostalgia pervasive in “The Force Awakens,” alienated some hard-core fans who criticized “The Last Jedi” online and didn’t return for multiple viewings as they have for prior installments.

Overseas, “The Last Jedi” has grossed close to $700 million, about $180 million more than “Rogue One” but $430 million less than “The Force Awakens.”

The biggest chunk of that shortfall came from China, where “The Last Jedi” has grossed a weak $41 million, just one-third as much as “The Force Awakens” and 41% less than “Rogue One.” Despite aggressive promotional campaigns including pop songs and Stormtroopers on the Great Wall, moviegoers in the world’s most populous nation have proved less interested in Luke, Leia and lightsabers.

Mr. Hollis said the “Last Jedi” China gross was disappointing and said Disney is still “digging into” the reasons and potential solutions.

If audiences need a break from “Star Wars,” they won’t get one this year. A spinoff focused on a young Han Solo opens Memorial Day weekend.

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